Some doctors are turning their practices into patient-centered medical homes, and insurance companies are paying them for it.

Insurers and health plans such as Blue Cross Blue Shield of Michigan and Priority Health, the two dominant coverage providers in West Michigan, are working toward the change. Last week BCBSM announced it has designated 1,000 Michigan doctors in its patient-centered medical home program, and another 3,800 are implementing parts of it. About 2 million patients are affected.

“This has been a very collaborative effort. … Physicians groups are investing time and talent into this shifting of thinking,” said Jeff Connolly, president of West Michigan Operations for BCBSM.

The program requires doctors in the 300 primary care practices represented in the program to meet certain benchmarks, such as extended office hours, electronic prescribing, performance reporting, test tracking and care management, particularly for people with chronic illnesses.

In patient-centered medical care, doctors and other staff, such as nurse practitioners, work together to coordinate patient care and teach patients to take a greater role in managing their own care. It requires changes in the way doctors do business, such as the use of electronic medical health records, staff meetings and additional staff hours. BCBSM has committed $30 million toward financial incentives for primary care physicians to make those changes in their practices.

At a recent press conference in Grand Rapids, Alliance for Health President Lody Zwarensteyn said that because of the breadth of BCBSM’s coverage — 4.7 million of the state’s 10 million residents — the nonprofit insurer’s commitment to patient-centered medical homes, which began in 2004, has been crucial in making Michigan a leader in the nationwide movement.

Other health plans and insurers have launched similar initiatives, although none include as many doctors or dollars as the BCBSM plan.

“We are able to see immediate improvement in the relationship between the primary care physician and the patients,” said Dr. Paul Ponstein, medical director of the Westshore Health Network, the physician-hospital organization based in Muskegon. Westshore’s 314 primary care physicians have been implementing patient-centered medical homes for two years and about half meet BCBSM’s designation criteria, he said.

“We’re already seeing improvement in quality metrics and improvements in efficiency. The most significant component that has helped us … has been the assistance in building the infrastructure within the organization allowing us to implement programs in physicians’ offices.”

The idea, now being implemented in pilot programs supported by insurers such as Blue Cross Blue Shield of Michigan and Priority Health, could save money in the long run, proponents said. Both insurers, who dominate the West Michigan market, are providing incentives for participating doctors.

“This is a statewide program, but you really have a very high level of enthusiasm and genuine action being taken in West Michigan. They have been working hard on this for a long time now. The people in West Michigan probably are noticing a lot of difference in the manner in which health care delivery is occurring.”

Simmer praised physician leadership in West Michigan for running with the concept and making changes in their practices.

“This is the real McCoy. This is really making a difference in how they practice,” he said. “They’ve seen a lot of programs come and go before, but this is the one that they feel is creating the foundation for health care delivery of the future. And so it really is the genuine article. Health insurers can help it happen, but the people who are really making it happen are in West Michigan. They are the ones working harder than anybody else to make this happen.”

BCBSM and Priority Health both are supporting the introduction of medical homes into primary care with a payment structure that rewards physicians for implementation.

Some of the changes in practices that create medical homes include same-day appointments, after-hours access, e-visits, chronic disease management, highly accessible lab results, use of evidence-based best practices and use of electronic medical records, electronic prescribing, practice Web sites and Web portals for patients.

“The approach right now is typically an acute care episode,” Olivarez said. “They go into the provider for what they are there for that day — a sore throat, a diabetes re-check.

“The new model, I would say, let’s you look at the whole person. You’re here for a sore throat; I also see you need labs required for diabetes and you’re also due for a mammogram.”

To enhance education and awareness, Priority Health brought in national speakers to discuss medical homes with providers and employers, and has sent some of them to the Institute for Health Care Improvement, a Cambridge, Mass.-based nonprofit devoted to changing the health care system.

“We can also, obviously as an insurer, address some of the reimbursement issues, and so we’re doing this through some payment reform,” Olivarez said. “We’re traditionally a capitation-based reimbursement, and so what we’re doing is pulling some services that have previously been considered under capitation, and paying them fee-for-service so they’re complementing the services. We’re doing this for all our fully funded lines of business starting April 1, as well as doing a capitation increase.

“The reason all that’s important is we recognize that, although the system may not be functioning as coordinated as we like, they still need some financial assistance up front.”

Priority Health also is looking at ways to mine its claims information to help those practices create patient registries, essentially lists of patients with certain health conditions, she said. The nonprofit is considering how to help create registries that include all of a practice’s patients, not just its Priority Health members, Olivarez added.

Priority Health has provided some additional funding for 16 network practices for work on patient access, care coordination, patient engagement and information technology.

Medical homes include a patient’s relationship and access to a doctor and a comprehensive approach to care coordination that encompasses a team of different providers within the practice. Electronic medical records play a role, as well, in allowing practices to create registries of patients — for example, all the patients with congestive heart failure — and cross-check whether they’ve received care according to standard benchmarks.

“This whole effort can only succeed if the health plans recognize the added value, and support it with a payment process that rewards that added value,” Simmer said.

At BCBSM, Simmer said, 6,600 physicians are in the program and 1,700 have been nominated for patient-centered medical home designation. He said the insurer plans to identify 500 doctors for the designation in July.

“Over 70 percent of the primary care physicians in the state of Michigan are participating in the program. Roughly 8 to 10 percent will be designated,” he said, with additional designations planned in the years ahead. “We don’t consider it pilot or test. We consider it a statewide program.”

Dr. David Blair, CEO of Advantage Health, the 120-doctor primary care provider that is owned by Saint Mary’s Health Care, said the organization has gone through many hours of labor and expense to meet the different expectations of different insurers as the medical home concept is put into practice.

BCBCM has its own model for medical homes, which Simmer said includes 24 benchmarks, while Priority Health chose a model developed by the National Committee on Quality Assurance, said Blair.

“The topics are mostly the same kind of topics. At a detail level, there’s a great deal of difference,” Blair said. “And these take many, many people to actually end up shepherding these projects forward. So it really becomes quite a financial burden for us to pursue these initiatives that actually promise us some mild financial improvement. It would be a big gain if the employer community created a stronger expectation that these insurance plans standardize.”

“From a doctor’s perspective, you need to have strong systems in place, and documentation,” said Dr. Theresa Osborne, an internist for Michigan Medical PC. “You have to have the ability to access data from a wide variety of sources and coordinate that data. You often have the add-on of a care manager, which could be a nurse or medical assistant. So the basic difference, as opposed to a one-on-one doctor … is that the medical home is a team of providers integrating the doctor, the patient and care management for total care of the patient.

Bringing the medical home concept to fruition for primary care is an issue that cuts across competitors, Olivarez added.

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